Australian patients pay more for healthcare than many other comparable countries, according to a new analysis. Changes have been proposed, but what would they mean for general practice?
A report released this week by the Grattan Institute, a Melbourne-based think tank, made suggestions for reducing healthcare costs for Australians.
Its report, “Not So Universal: How to Reduce Out-of-Pocket Payments for Healthcare,” outlines the costs paid by patients in Australia.
Citing recent figures from the Australian Institute of Health and Welfare (AIHW), the report says more than $7 billion was spent on out-of-hospital care and medicines provided under the Pharmaceutical Benefits Schedule. (PBS).
In addition, more than one million Australians spend more than $1,000 each year on out-of-hospital care and medication, the report says.
The authors point in particular to the impact on the most vulnerable, saying that the costs of services have increased by an average of 50% in real terms over the past decade.
“Many Australians cannot afford the health care they need, especially those with chronic conditions,” the authors write.
“As a result, they lack care, get sicker and the healthcare system is therefore strained.”
The report argues that the country is too dependent on out-of-pocket payments and examines what could be done to cut costs so that fewer people go without healthcare.
Dr. Emil Djakic, member of the RACGP Committee of Experts – Health System Financing and Reform (REC-FHSR), said newsGP the report is an interesting addition to the funding discussions – although he said the focus appears to be on other specialists outside of general practice.
“It’s a fact that we have costs to pay for in our health care system, in the whole system,” he said.
According to the report, out-of-pocket health spending represents 17% of Australia’s total spending, one of the highest rates in the OECD.
The report’s authors also cite higher pharmaceutical payments among Australian residents compared to other affluent countries, stating that patients there pay 28% of the country’s total pharmaceutical expenditure, more than in many other countries.
“As a result, Australia ranks poorly compared to other high-income countries in the proportion of people skipping medication due to cost,” the report said.
Dr. Djakic believes the report is right to focus on the shortcomings of PBS.
‘[The Grattan Report] rightly highlights the complete irresponsibility of the PBS safety net on the medical side, which manages to offer subsidies to those who are better off,” he said.
“There is a huge part of our system infrastructure that is not being held accountable.”
Several measures proposed by the Grattan Institute report would have implications for general practice if implemented.
“The federal government should subsidize the creation of new co-located private specialty clinics that do not charge patients out of pocket,” the authors write.
“These ‘specialty wholesale billing clinics’ should be established within general practice wholesale billing practices.
“Co-locating these new services with GP would strengthen primary care by providing informal learning opportunities for GPs, potentially reducing future referrals.”
The report also suggests that state governments could consider co-locating expanded outpatient services with GPs.
Another proposal is the creation of a new list of specialist referrals ranked by cost, but Dr Djakic said this could add to the bureaucracy faced by GPs.
The Grattan Institute report also highlights the number of missed appointments and prescriptions due to cost concerns.
It says 3.4% of people with chronic conditions missed GP care in 2020-21, compared to 6.4% who missed care with other specialists. This compares to 1.3% and 4.4% among people who do not have chronic conditions.
While rates of missed care are lower for GPs than elsewhere, Dr Djakic says the numbers are still worrying.
“Our out-of-pocket costs are considered a low barrier to care, but the accrued costs can be significant for some patients who are seen several times a year or for a large family,” he said.
The Grattan Institute report came out the same week that Federal Health Minister Greg Hunt promoted record levels of bulk billing among GPs in Australia.
He said GP bulk billing rates stood at 88.4 per cent in the December quarter last year, a record high likely largely due to mandatory bulk billing for telehealth . However, as former RACGP President Dr. Harry Nespolon once pointed out, this statistic represents the number of mass-billed services, not the number of patients.
The bundle billing figures have also been criticized for not reflecting the growing gap between Medicare patient reimbursements and health care inflation.
Dr Djakic refers to the four-year indexation freeze and notes that while other specialists have increased their out-of-pocket spending significantly, GPs have not increased in the same way.
‘[The report] is a good job to bring into the debate – at the very heart of it is the fact that Medicare as a universal insurer is failing dramatically,” he said.
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